Can someoe help me get 19-21 (16) The production process exhibits (a) Constant-r
ID: 1124109 • Letter: C
Question
Can someoe help me get 19-21
(16) The production process exhibits (a) Constant-returns-to- scale. (b) Increasing-returns-to- scale. (e) Diminishing-returns-to- scale. (e) At first increasing-returns-to- scale, then diminishing-returns-to- scale (17) ) When K -3 and L-4 the morginal product (MP the of the 4 unit of capital is 44 When K -2 and L- 4 the MP of the 5% unit of labor is 6s. When K-3 and L-3 the MP of the 4 unit of capital is 64 When K - 4 and L - 2 the MP of the S unit (e) None of the above The table below relates a purely competitive firm's (TC). Use it to answer the following four (4) questions: (Q) to its short-run "total costs output 0 l TC l s5501 587 636 | 693 758 829 912 999 587 636 693 758 829 912 999 (18) Total fixed cost (TFC): (a) Cannot be determined from the information given. (b) Equals $550 (c) Equals $587 (d) Becomes smaller as Q increases. (e) Becomes larger as Q increases. If the market price of the good in question is $73 and we assume that only whole units can be produced (e.g., 3 units but profits the firm will, in the short run, produce: ) (a) 0 units. (b) 2 units (c) 3 units. (d) 4 units (e) 5 units.Explanation / Answer
19.Option e -5
The profit max condition is P = MC.
P = 73. Hence, we look for output level such that MC is greater than yet closer to 73. This condition holds true when Q = 5 units.
20. Option a 0 units
In long run, a firm will earn zero profits (or, normal profits). But, if it earns negative profits (losses), then it must exit from the industry. (see calculations in table)
21. Option e- None of the above
For this question, we can verify that none of the options hold true (see above table)
Q TC MC TR = P*Q Profit = TR - TC TVC = TC- 550 AVC = TVC/Q 0 $ 550.00 $ - $ (550.00) $ - 1 $ 587.00 $ 37.00 $ 73.00 $ (514.00) $ 37.00 $ 37.00 2 $ 636.00 $ 49.00 $ 146.00 $ (490.00) $ 86.00 $ 43.00 3 $ 693.00 $ 57.00 $ 219.00 $ (474.00) $ 143.00 $ 47.67 4 $ 758.00 $ 65.00 $ 292.00 $ (466.00) $ 208.00 $ 52.00 5 $ 829.00 $ 71.00 $ 365.00 $ (464.00) $ 279.00 $ 55.80 6 $ 912.00 $ 83.00 $ 438.00 $ (474.00) $ 362.00 $ 60.33 7 $ 999.00 $ 87.00 $ 511.00 $ (488.00) $ 449.00 $ 64.14